agilon health (AGL) Q2 2024 earnings summary

Executive summary

• Revenue grew 39% year-over-year to $1.5 billion in Q2 2024, driven by 38% Medicare Advantage membership growth to 513,000 and expansion into new geographies.

• Net loss for Q2 2024 was $31 million, compared to $17 million in Q2 2023; year-to-date net loss was $37 million versus $1 million in the first half of 2023.

• Adjusted EBITDA for Q2 2024 was a loss of $3 million, at the high end of guidance, with year-to-date Adjusted EBITDA at $26 million.

• Select unprofitable contracts were terminated retroactive to January 1, 2024, reducing membership by 17,000 and revenue by up to $110 million, with no impact on Q2 medical margin.

• Significant organizational changes include a new CFO, Chief Medical Officer, and strategic advisor roles.

Financial highlights

• Q2 2024 total revenue was $1.48–$1.5 billion, up 39% year-over-year, with medical services expense rising 47% to $1.37 billion.

• Medical margin for Q2 2024 was $106 million (7.1% of revenue), down from $134 million (12.6%) last year.

• Gross profit for Q2 2024 was $32 million, down 41% from Q2 2023.

• Platform support costs were 2.8–3% of revenue in Q2 2024, down from 4% in Q2 2023.

• Cash, cash equivalents, and marketable securities at quarter-end were $408 million, with $104 million off-balance sheet for ACO REACH.

Outlook and guidance

• Full-year membership guidance raised to a midpoint of 519,000; revenue guidance reduced to $6.01–$6.04 billion due to contract terminations and lower risk adjustment.

• Medical margin guidance maintained at $400–$450 million, expected near the lower end.

• Adjusted EBITDA guidance unchanged at -$60 million to -$15 million.

• Free cash flow positive expected in 2026 and beyond.

• Q3 2024 revenue expected at $1.465–$1.475 billion, medical margin $90–$110 million, and Adjusted EBITDA loss of $30–$10 million.